For phone companies, landline revenues are declining, and will continue until there's nothing left. Cell-service revenues are also declining, due to pricing pressure. The next area of growth for them
and mobile content providers will undoubtedly be ad revenue. And if the movement of Google and Yahoo is any indication, that future is here. Just as it did with Internet advertising, search will lead
the way, and mobile video, music downloads and other data services will follow. Right now, only 15 percent of the mobile-phone population (28 million people) has downloaded some type of multimedia
content on their phones in the last three months, according to mobile tracking firm M:Metrics. So why isn't anybody using the mobile Web? "Surfing the mobile Internet is still hard," says Eric McCabe,
vp of marketing for JumpTap. "The wired Internet didn't really start to explode until search tools like Google made it much easier to find things online." Users are also more impatient when they are
using their mobile phones than when they're sitting in front of their computer. They don't want to wait for downloads, and don't have time to wade through pages of search results. But Marguerite
Reardon of CNET says the problem isn't technology, but rather the business model of local search. The smaller screen means search text links won't work. Because mobile providers control the content
users see on cell phones, Google and Yahoo will have to strike individual deals with each carrier. Google is already making inroads in the U.S., UK, Germany and Japan, having struck deals with
T-Mobile and Vodafone. Yahoo recently cut a deal with Orange that embeds its search engine in some Nokia handsets.
Read the whole story at CNET News.com »
